29th Aug 2007 07:01
Glanbia PLC29 August 2007 2007 Interim Results A FULL COPY OF THIS PRESENTATION IS AVAILABLE ON WWW.GLANBIA.COM STRONG FIRST HALF PERFORMANCE DELIVERS 26% GROWTH IN EARNINGS PER SHARE UPWARD REVISION IN EARNINGS GUIDANCE TO HIGH TEENS FOR FULL YEAR 29 August 2007 - Glanbia plc, the international dairy foods and nutritionalingredients Group, announces its interim results for the six months ended 30June 2007. 2007 Interim Results Summary Glanbia delivered strongly in terms of profits, margins and earnings per sharegrowth in the first half of 2007. The Group benefited, in particular, from goodunderlying growth in Food Ingredients USA and the expansion of the globalNutritionals business, against a background of positive trends in world dairymarkets. H1 2007 H1 2006 ChangeRevenue €1,040.3 m €922.8 m Up 13%Operating profit €48.5 m €36.4 m Up 33%Operating margin 4.7% 3.9% Up 80 bpsNet financing costs €8.6 m €6.5 m Up 32%Share of results of joint venturesand associates •(1.3 m) €0.3 m Down €1.6mProfit before tax €38.6 m €30.2 m Up 28%Profit for the period €33.8 m €26.9 m Up 26%Earnings per share 11.47 c 9.12 c Up 26%Adjusted earnings per share 11.47 c 9.12 c Up 26%Dividend per share 2.50 c 2.38 c Up 5%Net debt €269.1 m €301.2 m Down 11% John Moloney, Group Managing Director, said: "Glanbia had a very good first half this year, with earnings per share up 26%which is ahead of market expectations. The drivers of this performance were strong results from our Food IngredientsUSA and the global Nutritionals businesses, both of which are key to ourstrategy to diversify our earnings base into higher value added ingredients.Buoyant world dairy markets were also a contributing factor, as expanded demandcoupled with constrained supply, saw global markets rise to record levels in thefirst half of the year. These market developments are also significantlypositive for the dairy farming sector. Overall, the outlook for Glanbia is very satisfactory and we expect a strongperformance again in the second half. Notwithstanding the fact that there aresome short-term factors in our international joint ventures, we expect todeliver full year earnings growth in the high teens, which is an upgrade tocurrent market expectations." Presentations As part of the announcement of these results Glanbia plc will undertake a numberof presentations for investors, analysts and media. In addition, the Group ishosting a conference call and webcast, details of which, together with theresults presentation, can be accessed via the Results Centre on www.glanbia.com. 2007 Interim StatementResults for the half year ended 30 June 2007 FINANCE REVIEWGlanbia delivered a strong performance on an overall basis, with a significantincrease in revenue, profits, margins and earnings per share recorded in thefirst half of 2007. Income statementRevenue increased 13% (€117.5 million) in the first half of 2007 to €1.04billion (H1 2006: €922.8 million). This increase is a combination of price andvolume growth in Food Ingredients USA and Nutritionals including a full sixmonth contribution from Seltzer Companies Inc., the Nutritionals acquisitioncompleted in October 2006. Operating profit grew 33% (€12.1 million) to €48.5million (H1 2006: €36.4 million) and the operating margin improved 80 basispoints to 4.7% (H1 2006: 3.9%). The operating profit and operating margin bothreflect the changing mix of business towards higher added value food ingredientsand buoyant world dairy markets. Financing costs increased €2.1 million to €8.6 million (H1 2006: €6.5 million)mainly due to higher interest rates. Interest cover was 5.6 times in H1 2007 andH1 2006. The Group's share of results of joint ventures and associates recorded a loss of€1.3 million (H1 2006: Group's share of profit €0.3 million), due to a lag inthe recovery of the significant increases in world dairy raw material prices intheir served markets. Profit before tax grew 28% (€8.4 million) to €38.6 million (H1 2006: €30.2million). Taxation amounted to €4.8 million in the first half of this yearcompared with €3.3 million for the same period last year. Profit for the periodincreased 26% (€6.9 million) to €33.8 million (H1 2006: €26.9 million). Basic and adjusted earnings per share amounted to 11.47 cent per share (H1 2006:9.12 cent per share), which is a 26% increase when compared to the first half of2006. Balance sheet and cash flowNet cash used in investing activities amounted to €26.5 million (H1 2006:€25.9million). Net cash generated from operations pre movement in working capital was€52.7 million (H1 2006: €34.2 million). Group net debt reduced by €32.1 millionto €269.1 million compared with net debt at 1 July 2006 (H1 2006: €301.2million). Since 2006 year end, the pension deficit reduced from €124.9 million to €83.3million as a result of increased bond rates and improved investment returnsduring the period. The principal effect of this on the Group's balance sheet wasto increase shareholders equity in the business from €193.9 million at 30December 2006 to €244.9 million at 30 June 2007. DividendsThe Board is recommending an interim dividend of 2.50 cent per share (H1 2006:2.38 cent per share), representing an increase of 5%. Dividends will be paid on3 October 2007 to shareholders on the register as at 14 September 2007, therecord date. Irish dividend withholding tax will be deducted at the standardrate, where appropriate. OPERATIONS REVIEW Ireland Alongside international expansion, Glanbia has also consistently invested inIreland to ensure that these core divisions continue to maintain or improveperformance, notwithstanding the competitive operating and cost environment inthe domestic market. In the first half of 2007, continued solid businessexecution helped Irish operations deliver overall results in line withexpectations. CONSUMER FOODS Consumer Foods •'000 H1 2007 H1 2006 ChangeThis division includes:Consumer Foods incorporating nutritional Revenue 249,042 252,282 Down 1.3%beverages, fresh dairy products and cheeses, Operating profit 8,335 8,470 Down 1.6%soups and spreads; and,Pigmeat, which produces a Operating margin 3.3% 3.4% Down 10 bpsrange of pork and bacon products. Revenue at the Consumer Foods division declined 1.3% to €249 million. (H1 2006:€252.3 million). Operating profit decreased 1.6% (€0.2 million) to €8.3 million(H1 2006: €8.5 million) and the operating margin decreased slightly to 3.3% (H12006: 3.4%). Consumer Foods IrelandConsumer Foods had a satisfactory first half and revenues, profits and marginsremained stable. This business unit continued to focus on widening its consumeroffering with a number of new products in the nutritional area and in theconvenience food segment. The business also continues to increase its marketinginvestment to deepen its brand franchise, which currently has seven of the top100 Irish grocery brands. Outlook: The consumer foods retail environment in Ireland is very competitiveand Glanbia continues to counteract this through innovation, delivering newproducts, reformulations and repackaging to the marketplace and consumers,together with significant investment in marketing and promotions. For the fullyear this business is expected to deliver a reduced performance on last year;the key issue being the timing of the recovery from the marketplace of highermilk cost. PigmeatThe Glanbia Meats performance was neutral when compared to the same period lastyear. The rationalisation benefits of the closure of the cannery operation in2006 were offset by a weaker performance in the slaughtering plants driven byweak international pork markets. Outlook: A reasonable recovery is anticipated in this business in the secondhalf as markets are expected to improve somewhat, in addition to the normalseasonal performance uplift. A recent fire at one of the Group's pig processingplants will not materially impact the 2007 results and performance for the fullyear is expected to be largely in line with 2006. AGRIBUSINESS AND PROPERTY Agribusiness & Property •'000 H1 2007 H1 2006 ChangeThis division includes:Agribusiness which is the Revenue 170,011 165,615 Up 2.7%key linkage with the Group'sIrish farmer supply base; Operating profit 11,811 15,857 Down 26%and Property, which hasresponsibility for the Operating margin* 4.9% 5.8% Down 90 bpsmaximisation of value from the Group's property portfolio. *Note: the operating margin excludes Property In the first half, revenue for Agribusiness and Property was up 2.7% to €170million (H1 2006: €165.6 million). Operating profit declined €4 million or 26%to €11.8 million (H1 2006: €15.9 million) mainly due to lower property disposalsin comparison with the first half of 2006, when the majority of the 2006property transactions were completed. AgribusinessThis business had a reasonable first half. Feed and fertiliser volumes were inline with expectations, although margins reduced in what is a competitiveenvironment. The CountryLife retail offering continues to make good progress. Outlook: A positive outlook for key sectors, including dairy and cereals, willhelp to underpin the Agribusiness performance and deliver results in line with2006. PropertyThe pace of transactions in 2007 will be evenly spread between the first andsecond half and the outcome for the year as a whole is expected to be broadlysimilar to 2006. FOOD INGREDIENTS AND NUTRITIONALS Food Ingredients & •'000 H1 2007 H1 2006 ChangeNutritionalsThis division has FoodIngredients operations inIreland and the USA thatproduce cheese, butter, Revenue 621,284 504,896 Up 23%casein and protein ingredients. It also Operating profit 28,398 12,079 Up 135% includes the Group'sglobal Nutritionals Operating margin 4.6% 2.4% Up 220 bpsbusiness - which supplies advanced technology wheyproteins/fractions andcustomised vitamin and mineral premixes to the global nutrition industry. In the first half, revenue from this division was €621.3 million (H1 2006:€504.9 million). Operating profit increased 135% (€16.3 million) to €28.4million (H1 2006: €12.1 million) and operating margins improved 220 basis pointsto 4.6% (H1 2006: 2.4%). Food Ingredients USA and the global Nutritionalsbusinesses were the drivers of this improved performance. The further expansionof operations and the buoyant global dairy markets contributed to the strongresult from Food Ingredients USA while the profit and margin growth in theglobal Nutritionals business was driven by continued organic expansion and thecontribution from Seltzer Companies Inc. The performance of Food IngredientsIreland was in line with the same period last year. Food Ingredients IrelandThis business delivered a flat performance in the first half, compared with thesame period in 2006. While volumes and prices were ahead, these benefits werelargely offset by significant milk price increases to suppliers in the firsthalf. Margins in this business remained in line with 2006. Outlook: In light of continuing strong world dairy markets, the performance forthe full year for Food Ingredients Ireland is expected to be ahead of 2006. International Food Ingredients USAThis business had an excellent first half driven by high cheese and whey marketsand strong volume growth, resulting from the capacity expansion programmeundertaken in 2006. Outlook: We expect this business to perform strongly in the second half,supported by good demand, strong volumes and a positive pricing and marketenvironment. Overall returns continue to be leveraged by operational excellenceand world class production. Nutritionals Organic growth in the Nutritionals business was good and revenues, profits andmargins grew in line with expectations. The Seltzer acquisition also performedwell in the first half contributing to the growth in overall performance of thisbusiness. Outlook: We continue to develop this business through investment inacquisitions, new product development, innovation and people. The Seltzeracquisition is integrated into the Group and performing in line withexpectations. The Nutritionals business unit overall is expected to deliver astrong performance in the second half. INTERNATIONAL JOINT VENTURES Joint Ventures & Associates •'000 H1 2007 H1 2006 Change(GLANBIA SHARE) Glanbia has three Revenue (1) 176,130 96,306 Up 83%principle internationaljoint ventures, based Operating profit (2) (1,308) 283 Down €1.6 min the UK, USA andNigeria (1) Not included in Group revenue(2) Included in the income statement as share of results of joint ventures and associates Glanbia's long-term strategy is to build international relevance in cheese,nutritional ingredients and selected consumer foods and this incorporates anumber of joint ventures producing cheese, whey and milk products. Theseinvestments are based in the UK (Glanbia Cheese), the USA (Southwest Cheese) andNigeria (Nutricima). Collectively these businesses had a challenging first half. Glanbia Cheese is the No. 1 producer of mozzarella cheese for the Europeanmarket. This business had a difficult first half as the purchase price for itsraw material milk supply increased dramatically in line with world dairymarkets, resulting in margin pressure. Cheese price increases are being secured,however there is a time lag given the scale of milk cost increases. Full yearperformance will be less than last year. Southwest Cheese (SWC) is the Group's cheese and whey joint venture in NewMexico. This business had good volume growth in the first half of the year andoperationally the plant is performing very well. However, this good progress wasmore than offset in the first half by a margin squeeze resulting from high rawmaterial costs. Based on market conditions, a breakeven performance is expectedfor the full year. Nutricima is a joint venture with PZ Cussons plc which manufactures and marketsbranded dairy based consumer products for the Nigerian market. In developingeconomies, such as Nigeria, there are timing issues in passing sharp rawmaterial price increases onto consumers and this, coupled with the need forstrong marketing spend to build the Nutricima brands, more than offset a goodoperational performance and top line growth that delivered to plan. Theperformance for the year is expected to be marginally lower than last year. 2007 Outlook Glanbia continues to benefit from its spread of businesses against a backdrop ofpositive trends in world dairy markets. 2007 has seen an unprecedented shift inglobal dairy markets, which on an overall basis has had a positive effect onGlanbia's performance in the first six months of the year. Food Ingredients andNutritionals, the Group's largest division is performing well. Irish milkprocessing operations are recovering from a difficult 2006 and Food IngredientsUSA and our global Nutritionals business are having an excellent year. Otheraspects of the business are performing in line with expectations although theoperating and cost environment in the Irish market creates a challenging placeto do business. Overall, the outlook for Glanbia is very satisfactory and weexpect a strong performance again in the second half. Notwithstanding the factthat there are some short-term factors in our international joint ventures, weexpect to deliver full year earnings growth in the high teens, which is anupgrade to current market expectations. Consolidated income statementfor the half year ended 30 June 2007 Half year 2007 Half year 2006 Year 2006 Pre- Pre- Pre- excep- Excep- Total excep- Excep- Total excep- Excep- Total Notes tional tional Total tional tional Total tional tional Total •'000 •'000 •'000 •'000 •'000 •'000 •'000 •'000 •'000 Revenue 3 1,040,337 - 1,040,337 922,793 - 922,793 1,853,427 - 1,853,427 -------- -------- -------- -------- -------- -------- -------- -------- -------- Operating profit 48,544 - 48,544 36,406 36,406 85,567 (12,455) 73,112 Finance income 5 2,335 - 2,335 2,125 - 2,125 4,883 - 4,883Finance costs 5 (10,965) - (10,965) (8,662) - (8,662) (18,918) - (18,918)Share of results of joint venturesand associates (1,308) - (1,308) 283 - 283 2,842 - 2,842 -------- -------- -------- -------- -------- -------- -------- -------- -------- Profit before taxation 38,606 - 38,606 30,152 - 30,152 74,374 (12,455) 61,919Income taxes (4,790) - (4,790) (3,226) - (3,226) (7,970) 12,321 4,351 -------- -------- -------- -------- -------- -------- -------- -------- -------- Profit for the period 33,816 - 33,816 26,926 - 26,926 66,404 (134) 66,270 -------- -------- -------- -------- -------- -------- -------- -------- -------- Attributable to:Equity holdersof the Parent 33,599 26,725 65,934Equity minorityinterest 217 201 336 -------- -------- -------- 33,816 26,926 66,270 -------- -------- -------- Earnings per share (cent) 7- Basic 11.47 9.12 22.51 - Diluted 11.46 9.11 22.47 Consolidated statement of recognised income and expensefor the half year ended 30 June 2007 Half year Half year Year Notes 2007 2006 2006 •'000 •'000 •'000 Actuarial gain - defined benefit schemes 10 34,557 42,536 37,082Deferred tax on pension gain 10 (3,575) (4,796) (3,923)Currency translation differences 9 (2,790) (943) (9,401)Fair value adjustments (943) 4,557 2,734 ------- ------- ------- Net income recognised directly in equity 27,249 41,354 26,492Profit for the period 33,816 26,926 66,270 ------- ------- ------- Total recognised income for the period 61,065 68,280 92,762 ------- ------- ------- Attributable to:Equity holders of the Parent 60,848 68,079 92,426Equity minority interest 217 201 336 ------- ------- ------- 61,065 68,280 92,762 ------- ------- ------- Consolidated balance sheet as at 30 June 2007 Half year Half year Year Notes 2007 2006 2006 •'000 •'000 •'000ASSETSNon-current assetsProperty, plant and equipment 331,076 337,597 335,152Intangible assets 135,312 58,330 138,724Investments in associates 10,976 11,066 10,933Investments in joint ventures 58,731 58,107 58,668Available for sale investments 12,363 29,452 12,527Trade and other receivables - 58,220 -Derivative financial instruments 2,430 2,730 2,095Deferred tax assets 20,348 11,073 23,923 ------- ------- ------- 571,236 566,575 582,022 ------- ------- -------Current assetsInventories 164,629 157,619 145,158Trade and other receivables 288,801 237,203 169,540Derivative financial instruments 12,173 5,463 6,776Cash and cash equivalents 8 148,891 33,183 259,311 ------- ------- ------- 614,494 433,468 580,785 ------- ------- ------- Total assets 1,185,730 1,000,043 1,162,807 ------- ------- ------- EQUITYIssued capital and reservesattributableto equity holders of the ParentShare capital 98,378 98,309 98,304Other reserves 9 109,963 123,885 113,696Retained earnings 10 36,519 (45,756) (18,116) ------- ------- ------- 244,860 176,438 193,884Equity minority interest 6,852 6,500 6,635 ------- ------- ------- 251,712 182,938 200,519 ------- ------- ------- LIABILITIESNon-current liabilitiesBorrowings 8 417,110 333,392 444,570Deferred tax liabilities 38,424 34,104 38,611Trade and other payables - - 11,373Retirement benefit obligations 83,269 120,124 124,888Provisions for other liabilities andcharges 6,689 6,616 6,032Derivative financial instruments 4,655 - 3,406Capital grants 10,267 14,382 10,660 ------- ------- ------- 560,414 508,618 639,540 ------- ------- -------Current liabilitiesBorrowings 8 854 986 39,235Provisions for other liabilities andcharges - 2,357 7,110Trade and other payables 355,542 295,993 270,773Current tax liabilities 6,732 7,416 1,942Derivative financial instruments 10,476 1,735 3,688 ------- ------- ------- 373,604 308,487 322,748 ------- ------- -------Total liabilities 934,018 817,105 962,288 ------- ------- ------- Total equity and liabilities 1,185,730 1,000,043 1,162,807 ------- ------- ------- Consolidated cash flow statementfor the half year ended 30 June 2007 Half year Half year Year Notes 2007 2006 2006 •'000 •'000 •'000 Cash flows from operating activitiesCash (absorbed by)/generated fromoperations 11 (1,732) (51,169) 58,486Interest received 2,335 301 1,000Interest paid (11,109) (8,837) (19,967)Tax refunded/(paid) - 415 (6,274) ------- ------- ------- Net cash (absorbed by)/generatedfrom operating activities (10,506) (59,290) 33,245 ------- ------- ------- Cash flows from investing activitiesAcquisition of subsidiary, net ofcash acquired (deferred consideration) (7,166) (811) (69,892)Purchase of property, plant andequipment (17,382) (28,112) (38,085)Purchase of available for saleinvestments (2,287) (2,667) (3,406)Disposal of subsidiary, net ofcash disposed - 812 (323)Disposal of investments - 4,147 22,185Repayment of loan note - - 52,822Proceeds from sale of property,plant and equipment 296 716 8,665 ------- ------- ------- Net cash used in investing activities (26,539) (25,915) (28,034) ------- ------- ------- Cash flows from financingactivitiesProceeds from issue of ordinary shares 74 190 190Sharesave Scheme - receipt fromTrustees - - 122(Repayment)/drawdown of borrowings (61,844) 17,329 169,851Finance lease principal(payments)/drawdowns (632) 7,809 (1,077)Dividends paid to Company's shareholders (9,946) (9,499) (16,472)Capital grants received - - 123 ------- ------- ------- Net cash (used in)/generated fromfinancing activities (72,348) 15,829 152,737 ------- ------- ------- Net (decrease)/increase in cashand cash equivalents (109,393) (69,376) 157,948 Cash and cash equivalents at thebeginning of the year 259,311 104,405 104,405Effects of exchange rate changeson cash and cash equivalents (1,027) (1,846) (3,042) ------- ------- ------- Cash and cash equivalents at theend of the period 148,891 33,183 259,311 ------- ------- ------- Notes to the interim financial statementsfor the half year ended 30 June 2007 1 Basis of preparation This condensed interim financial information for the half year ended 30 June2007 has been prepared in accordance with IAS 34, 'Interim Financial Reporting'.The condensed interim financial information should be read in conjunction withthe annual financial statements for the year ended 30 December 2006. The figures for the half years ended 30 June 2007 and 1 July 2006 have not beenaudited. The figures for the full year ended 30 December 2006 represent anabbreviated version of the Group's financial statements for that year, whichreceived an unqualified audit report. 2 Accounting policies The accounting policies adopted are consistent with those adopted in thepreparation of the annual financial statements for the year ended 30 December2006 and are as described therein. The Group has considered all amendments to current standards and interpretationstogether with all new standards and interpretations and have identified thefollowing as being applicable to the current year reporting: IFRS 7 - Financial Instruments: Disclosures, and a complementary amendment toIAS 1, Presentation of Financial Statements - Capital Disclosures The Group assessed the impact of IFRS 7 and the amendment to IAS 1 and concludedthat the main additional disclosures will be the sensitivity analysis to marketrisk and the capital disclosures required by the amendment to IAS 1. The Grouphas determined that such disclosures are not significant to an understanding ofits 2007 Interim Results and the Group will adopt the provisions of IFRS 7 forits full year Financial Statements. 3 Segment information At 30 June 2007 the Group is organised into three main business segments:- Consumer Foods- Agribusiness and Property- Food Ingredients and Nutritionals Half year Half year Year 2007 2006 2006 •'000 •'000 •'000 Turnover by business segment Consumer Foods 249,042 252,282 511,022Agribusiness and Property 170,011 165,615 264,492Food Ingredients and Nutritionals 621,284 504,896 1,077,913 ------- ------- ------- 1,040,337 922,793 1,853,427 ------- ------- ------- Pre-exceptional operating profit by business segment Consumer Foods 8,335 8,470 24,525Agribusiness and Property 11,811 15,857 16,876Food Ingredients and Nutritionals 28,398 12,079 44,166 ------- ------- ------- 48,544 36,406 85,567 ------- ------- ------- 4 Exceptional items Half year Half year Year Notes 2007 2006 2006 •'000 •'000 •'000 Restructuring cost (a) - - (3,277)The Cheese Company Holdings Limited (b) - - (9,178) ------- ------- ------- - - (12,455) Exceptional tax credit (c) - - 12,321 ------- ------- ------- Net exceptional items - - (134) ------- ------- ------- (a) Restructuring costs relate to the closure of the Pigmeat cannery operation. Costs include redundancy and the release of unamortised capital grants. (b) On 29 December 2006, the Group disposed of its 25% interest and related 2008-2018 loan note in The Cheese Company Holdings Limited to the majority shareholder, Milk Link Limited. (c) A deferred tax asset of €12.1 million arising from the expected use in future years of UK tax losses, which previously had not been recognised due to uncertainty as to recoverability, has been recognised in the 2006 financial statements. Also, in 2006, the restructuring provision in the Pigmeat Division resulted in a corporation tax credit of €699,000 and a deferred tax charge of €489,000. 5 Finance income and costs (a) Finance income Half year Half year Year 2007 2006 2006 •'000 •'000 •'000 Interest income 2,335 2,125 4,883 ------- ------- ------- 5 Finance income and costs (continued) (b) Finance costs Half year Half year Year 2007 2006 2006 •'000 •'000 •'000 Interest expense- Bank borrowings repayable within five years (5,706) (6,695) (15,096)- Bank borrowings repayable after five years (3,480) - -- Finance leases (156) (147) (380) ------- ------- ------- (9,342) (6,842) (15,476) Finance cost of preferred securities andpreference shares (1,623) (1,820) (3,442) ------- ------- ------- Total finance costs (10,965) (8,662) (18,918) ------- ------- ------- 6 Dividends A final dividend in respect of the year ended 30 December 2006 of 3.41 cent pershare was paid during the period. On 28 August 2006, the Directors approved thepayment of an interim dividend for 2007 of 2.50 cent per share (2006 interimdividend: 2.38 cent per share). This interim dividend will be reflected in thefinancial statements for the full year 2007 in line with IAS 10. 7 Earnings per share Half year Half year Year 2007 2006 2006 •'000 •'000 •'000Basic Profit attributable to equityholders of the Company 33,599 26,725 65,934 -------- -------- -------- Weighted average number ofordinary shares in issue 292,984,514 292,943,460 292,958,667 -------- -------- -------- Basic earnings per share (centper share) 11.47 9.12 22.51 -------- -------- -------- Diluted Weighted average number ofordinary shares in issue 292,984,514 292,943,460 292,958,667Adjustments for share options 254,170 493,424 480,072 -------- -------- -------- Adjusted weighted average numberof ordinary shares 293,238,684 293,436,884 293,438,739 -------- -------- -------- Diluted earnings per share (centper share) 11.46 9.11 22.47 -------- -------- -------- Adjusted Profit attributable to equity holders of the Company 33,599 26,725 65,934Exceptional items - - 134 -------- -------- -------- 33,599 26,725 66,068 -------- -------- -------- Adjusted earnings per share (cent per share) 11.47 9.12 22.55 -------- -------- -------- Diluted adjusted earnings per share (cent pershare) 11.46 9.11 22.52 -------- -------- -------- 8 Borrowings Half year Half year Year 2007 2006 2006 •'000 •'000 •'000 Borrowings due within one year 854 986 39,235Borrowings due after one year 417,110 333,392 444,570Less:Cash and cash equivalents (148,891) (33,183) (259,311) ------- ------- ------- Net Group borrowings 269,073 301,195 224,494 ------- ------- ------- 9 Other reserves Capital and mergers Currency Fair value reserves reserve reserves Total •'000 •'000 •'000 •'000 Balance at 31 December2006 116,421 (7,603) 4,878 113,696 Translation differences onforeign currency net investments - (2,790) - (2,790)Revaluation of investments - - (199) (199)Gain on interest rate swaps - - 620 620Interest rate swaps reclassified as fairvalue hedges - - (1,291) (1,291)Foreign exchange contracts - gain in period - - 1,148 1,148Transfers to income statement- Foreign exchange contracts - - (749) (749)- Forward commodity contracts - - (594) (594)- Interest rate swaps - - (717) (717)Revaluation of forwardcommodity contracts - - 1,124 1,124Deferred tax on fairvalue adjustments - - (285) (285) ------- ------- ------- ------- Balance at 30 June 2007 116,421 (10,393) 3,935 109,963 ------- ------- ------- ------- 10 Retained earnings Retained Goodwill earnings reserve Total •'000 •'000 •'000 Balance at 31 December 2006 74,845 (92,961) (18,116) Actuarial gain - defined benefit schemes 34,557 - 34,557Deferred tax on pension gain (3,575) - (3,575) ------- ------- -------Net income recognised directly in equity 30,982 - 30,982Profit for the period 33,599 - 33,599 ------- ------- ------- Total recognised income for the period 64,581 - 64,581 Dividends paid in the period (9,946) - (9,946) ------- ------- ------- Balance at 30 June 2007 129,480 (92,961) 36,519 ------- ------- ------- 11 Cash generated Half year Half year Year 2007 2006 2006 •'000 •'000 •'000 Profit for the period 33,816 26,926 66,270 Non-cash loss on repayment of loan note - - 9,178Share of results of joint ventures andassociates 1,308 (283) (2,842)Income taxes 4,790 3,226 (4,351)Depreciation 14,938 13,122 25,415Amortisation 2,340 1,788 4,452Cost of share options 201 123 199Exchange losses - 66 -Gain on disposal of investments - (1,538) (1,541)Gain on disposal of property, plant andequipment (4,079) (7,128) (7,531)Interest income (2,335) (2,125) (4,883)Interest expense 10,965 8,662 18,918Amortisation of government grants received (393) (471) (4,322) ------- ------- ------- Net profit before changes in working capital 61,551 42,368 98,962Change in net working capitalIncrease in inventory (20,204) (15,379) (2,684)Increase in short term receivables (124,721) (91,792) (25,137)Increase/(decrease) in short termliabilities 88,752 19,710 (11,332)Decrease in provisions (7,110) (6,076) (1,323) ------- ------- ------- Cash (absorbed by)/generated from operations (1,732) (51,169) 58,486 ------- ------- ------- For further information contact Glanbia plc +353 56 777 2200Geoff Meagher, Deputy Group Managing Director/Group Finance DirectorSiobhan Talbot, Deputy Group Finance DirectorGeraldine Kearney, Corporate Communications Director + 353 87 231 9430Hogarth Partnership UK +44 207 357 9477John Olsen This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Glanbia